Tax planning now prime concern for corporates: KPMG

MUMBAI: Tax planning is becoming an important agenda in the boardrooms, primarily in the interest of shareholders, as corporates are increasingly looking for acquisitions overseas.

"Tax is becoming an important agenda in the boardroom now, as you are managing taxes for the shareholders," KPMG India's Head of Tax Practice Sudhir Kapadia told media on the sidelines of a workshop here today.

Corporates have been on acquisition spree in recent times in the foreign countries and tax laws there become important to them as they integrate their acquisitions and also keep in mind the interests of their shareholders.

Earlier, the CII-KPMG workshop on international tax strategies for companies highlighted global corporate tax practices for Indian companies creating a global footprint.

"Corporate tax in India is close to 35 per cent. Companies creating a global footprint will have to see that it remains within that limit outside India as well so that an overall tax outgo is not above Indian rate," Kapadia explained.

"China will be implementing new tax laws effective from January 1, 2008," KPMG China's Partner (Tax) David Ling said in his presentation in the workshop.

China's Unified Enterprise Income Tax Law will combine overseas investment and income tax law for foreign entities along with the provisional regulations of the Chinese enterprise income tax.

"The income tax reform in China will usher level playing field for the foreign investment enterprises and domestic companies," Ling said. This is as per WTO regulations to unify law for domestic and foreign companies, he added.